SAP in Healthcare 2023
A Broad Look at a Cross-Industry Player with a Growing Healthcare Focus

Several midsize and large healthcare customers have broadly adopted SAP’s platform and appreciate how robust the tools can be. Customer feedback around the tools’ usability, however, is mixed; some report high satisfaction and praise the systems’ configurability, while others report frustration with complex interfaces and the number of clicks. In general, respondents see their SAP tools as well integrated and able to achieve what they are intended to do. Highlights include the report-building, governance, and performance management capabilities. Respondents who are most satisfied with SAP’s technology and development strategy (mainly organizations with 500–2,000 beds) also express enthusiasm about the number of modules available, specifically for recruitment, learning management, and financial literacy. The largest customers (>2,000 beds) appreciate the breadth of SAP tools but say the rules engine and workflow configuration are not as robust as they would like, though their larger IT teams help them overcome usability challenges.

Overall, SAP has significant room for improvement in driving tangible outcomes. Some respondents note difficulty getting actionable data from their systems. The solutions’ usefulness is also limited by the need for significant investment in support by the organization, along with some tools not meeting healthcare needs out of the box (e.g., scheduling and timekeeping). In some cases, this stems from SAP overpromising during the sales cycle. When outcomes are achieved, they are often related to enhanced HR and finance functionality and data reliability. The most common outcome is a better employee experience—specifically, streamlined employee goal setting, career planning, and ongoing training management. A few customers that report workflow improvements cite technical expertise at their organization, which allows them to create automations that smooth workflows and reduce manual work.

SAP products generally work as expected for customers, though it often takes additional work to get them to a highly functional state. Integration is a particular strength for SAP, and customers using multiple products tend to rate this metric even higher. Newer cloud technology is described as robust and well integrated, though it also requires extra work to be successful. Training, implementation, and development are areas where respondents—across on-premises and cloud deployments—report significant challenges. They cite the need for more help from SAP with use-case and rules testing and change management, and they also want better training materials, especially for ongoing training to support new users. A few organizations report having a more positive implementation and training experience because they leveraged third-party firms for help; these organizations credit their firms’ proactivity, healthcare expertise, and guidance around workflow configuration. SAP respondents also want the vendor to deliver on development promises faster and want more communication and visibility regarding the product road map and the timing of releases.

Most interviewed customers using multiple SAP solutions plan to deepen their use of the vendor’s cloud-based technology to take advantage of the latest features, including upgrading to the cloud-based S/4HANA ERP solution and implementing new talent management technology in SuccessFactors. Respondents are excited about new development and expect some of these tools to enable better career planning and make ongoing training and development smoother—all of which should help ameliorate industry-wide staffing issues. To date, only a few customers are live on SAP’s cloud solutions. Organizations not planning to fully leverage SAP’s product suite mostly plan to keep certain pieces (especially HR and costing tools) and replace others (mostly ERP and analytics tools). More-established customers often feel that replacing SAP’s platform after years of refining their workflows would not be worth the cost and difficulty.

Prior experience with the vendor

“We selected SAP originally through the RFP process. SAP provided us with the functionality we were looking for, and the HR department’s leadership at the time had previous experience with SAP.” —Finance director

Breadth of portfolio

“Our organization knew that we needed to replace our financial accounting system. All of the software processes we had were siloed. We had multiple systems that didn’t communicate with each other, so everything we did was on paper. Because our financial accounting system was old, all of the programmers were retiring, and nobody was going to support the system. We decided to utilize SAP’s system, but we didn’t know that the system was going to be bigger than we thought it should be. The system didn’t just replace the financial accounting system; it replaced the procurement system, the fixed asset system, and the treasury module and put all of those processes into one system.” —VP of IT

Incumbent vendor

“We didn’t do an RFP, but we looked around and decided that it would be a lot more expensive to change to a new ERP than to migrate to S/4HANA. SAP will support the S/4HANA until 2040, so we have time to figure out what we want to do. We have to be fully migrated by 2027. Then SAP is going to stop supporting the old version we are on. We had done some customization, so to go to a new vendor with a cloud product, we would have had to replicate things in a more native cloud environment, and that was a deterrent. Right now, staying on premises is cheaper for us.” —CIO

Target customer
Midsize and large healthcare systems, teaching hospitals, critical access hospitals, insurance payers, and federal agencies; global market

Number of employees focused on healthcare
[Not provided]

Integration of go-forward solutions
Integrated on a single platform

AI technology

• AI embedded in platform
• Uses financial data, sourced from customers and proprietary data
• Open-source data accessible to clients
• Several use cases and features, including accounting and financial closing
• AI models continuously trained and updated

SAP Healthcare Executive Interview

Steve Risseeuw,
Senior VP of State, Local, Education & Healthcare at SAP

What is your background?
After serving in the US Air Force and exploring the financial services and consulting industries, I found my home supporting service-oriented customers in the software industry. It has been rewarding helping healthcare providers, insurers, federal entities, states, municipal governments, and educators. There are stereotypes for each of those organizations, and I’ve found that in each one there are dedicated professionals who care about improving and overcoming boundaries.

What should providers know about SAP’s investment in and commitment to healthcare?
SAP has a long-term commitment to and investment in healthcare, with over 7,900 providers and 97% of the life sciences organizations on the Fortune 2000. We have been delivering innovative solutions to our customers for over 50 years. As the industry continues to rapidly converge, we are working closely with providers and customers across our ecosystem moving into healthcare to drive innovation designed to deliver better, more cost-effective operational performance and consumer-oriented patient care. This includes seamless EMR integration with supply chain, experience and data analytics insights at the point of care to capture the true cost of care, and providing quality and cost-effective clinical services while facilitating world-class employee and patient satisfaction.

Cloud environment
AWS, Azure, Google, and SAP Converged Cloud

Development languages
ABAP (on premises and in the cloud), SAPUI5, Java, Node.js, and Python

Development platforms
Cloud Foundry, Kyma, Gardener, Kubernetes, and SAP Business Technology Platform

Mobile application environment
SAPUI5 (responsive apps), REST APIs, SAP Mobile Platform, SAP SDK for iOS, and SAP SDK for Android

Security platform
ISO 9001, ISO/IEC 27001, ISO 22301, BS 10012, ISO/IEC 27018, ISO/IEC 27017, SOC 1 & 2, PCI DSS, GxP, TISAX, FedRAMP, and ISO 14001 & 50001 (more information can be found at the SAP Trust Center)

Confidentiality
To support our customers who are subject to HIPAA compliance, SAP will enter into BAAs with its covered entity and business associate customers. SAP has enabled the physical, technical, and administrative safeguards required by HIPAA and the HITECH Act inside SAP Commerce Cloud. In the BAA, SAP makes contractual assurances about data safeguarding, reporting (including breach notifications), data access in accordance with HIPAA and the HITECH Act, and many other important provisions. SAP enables compliance with HIPAA and the HITECH Act and adheres to the HIPAA Security Rule requirements in its capacity as a business associate.

Data encryption
The SAP Trust Center outlines all security measures taken for each solution on cloud platforms.

Integration approach
SAP IDoc, OData, SAP Integration Suite, and Open Connectors

HITRUST certification
No